AAM Monthly Newsletter – Nov 2020

November 2020 AAM Newsletter

Hello and thank you for reading my e-newsletter.

I hope you find the information useful.  If you enjoy the newsletter please forward to a friend.   Please also let me know what you like to see so that I may continue to provide relevant content.

If you are a client of mine, thank you for your continued business and please update me on any changes in your situation do that I can make the appropriate changes to your financial plan and investments.

If you are not a client please consider giving me a call or emailing me if you would like to begin a plan to get you to your financial goals.  I consider myself different from many of the advisors out there for the following reasons:
1) You will not be pressured to purchase any products because I am a fee-only advisor and a NAPFA® Member (no commission sales)
2) You will have a comprehensive financial plan completed by a Certified Financial Planner ™ Practitioner or CFP® – I have committed to financial planning and continuing education.
3) You will have a reasonable fee for the services performed.  I charge less than the typical large financial planning firm by being a small shop and keeping my business expenses low.

Ronald J. VanSurksum, CFP®

For more insight on these groups and myself please click on the following links
www.napfa.org
www.cfp.net
www.fpanet.org  
www.aamllc.com

Please see below for financial articles and tips

Markets

Stocks were mixed in October as US Covid cases continued to rise and the election was on investors minds.

Index performance                                       Oct 2020____    YTD 2020_

  • The S&P index                                 -2.77%                 +1.21%
  • Dow Jones industrial 30                -4.61%                 -7.14%
  • The NASDAQ Index                         -2.29%                 +21.61%
  • The Russell 2000 Small cap          +2.04%                 -7.79%
  • EAFE International Index              -3.55%                -11.59%
  • The US Dollar                                   +0.20%                 -2.58% 
  • Oil                                                       -11.01%               -41.39%
  • Gold                                                    -0.50%                 +23.69%
  • 10-Year Treasury Yield                   0.87%                   1.91% on 12/31/2019
  • 30-Year Treasury Yield                   1.65%                   2.36% on 12/31/2019                   

Volatility was moderately high in October for the S&P 500 index.  The index began at 3,363 rose to a high of 3,534 on 10/12 then fell to a low of 3,271 on 10/28 before finishing at 3,270 to end the month for a difference of 263 points or about 7.4% from high to low.

Large cap and international stocks both were lower while small company stocks made up some ground and rallied.

Gold and oil were both lower while the US dollar and Treasury yields were higher.

Small and midcap stocks were higher in October after underperforming large cap stocks so far this year.  This is a good sign that more of the economy is beginning to participate in gains and diversification is being rewarded.

Stocks were lower going into the elections but began to rally the day before and have continued to rally for the last week despite a close and contested election.  Just another example to help investors realize it is hard to predict market moves.  Also, I am happy to see US treasury yields begin to rise and show some confidence in the economy.

Please contact me if you have questions or simply just wish to talk.  I am back in the office doing in-person meetings and I will still do meetings over the phone or computer if you are more comfortable with that.

Recent US Economic Data

US Manufacturing –ISM manufacturing rose and beat expectations.
Jobs – The October payroll report added a better than expected 638k jobs, unemployment fell to 6.9% which was lower than expected while average hourly earnings rose 0.1% but missed expectations.
Housing Prices –Both Shiller and FHFA home prices rose and beat expectations.
Housing starts –Housing starts rose but missed while building permits rose and beat estimates.
Existing home sales – Rose and beat estimates.
GDP – 3Q GDP first estimate came in at +33.1% and beat expectations.
Retail Sales – Rose and easily beat estimates.
Leading indicators – Rose a more than expected.
Durable goods orders – Rose and beat estimates.
Inflation data was higher – producer prices rose more than expected, consumer prices rose and matched, import prices and export prices both rose more than expected while PCE prices rose and matched estimates.

For weekly market updates please visit my blog at www.aamllc.com  

Mortgage Rates
Mortgage rates were lower over the last month.   The national average on mortgage as per Bloomberg.com shows the 15-year rate is now at 2.50% and the 30-year rate is at 3.02%. These rates are as of 11/11/2020 and may include points.   

CD Rates
CD rates were mixed over the last month.  Charles Schwab has access to CD’s from banks all over the country.  Here are some of the current CD rates offered.

6 mo CD @ 0.05%           1-Yr CD @ 0.05%

2-Yr CD @ 0.20%            5-Yr CD @ 0.45%

Tips and Suggestions
The next quarterly estimated tax payments are due 01/15/2021 for the 4th quarter of 2020. 

It is Medicare open enrollment time beginning 10/15 to 12/7.  This is when you can change your plan for 2021.  Consider contacting your insurance agent to determine if your current plan is still the best one for you especially if your circumstances have changed.

If you have a child attending college next fall it is FAFSA time once again beginning 10/1.  The sooner you fill out your FAFSA the better chance you have for financial aid.

Time to check your retirement contributions.  Develop a cash flow plan to maximize your health savings account, 401k, 457, 403b or IRA contributions for 2020.

Retirees do not have to take their required minimum distributions in 2020 due to Covid tax changes.  Now is a good time to review your tax plan to decide what makes the most sense for you.

It is time to plan for 2021!  What would you like to accomplish next year?  How much to you want to save and home much do you need to save to reach your financial goals? 

Is your estate plan up-to-date?  This is a good time to review your estate plan and update your beneficiary designations.

Do you have children age 18 years or older?  You may want to plan for an emergency by obtaining HIPPA authorizations or power-of-attorney so that you can get health information, if needed.

ABLE accounts are now available in the State of Michigan.  ABLE accounts are for certain individuals with disabilities to accumulate funds for their long-term needs without disqualifying themselves for Medicaid.  Check it out at www.miable.org or give me a call.

When is the last time you reviewed your insurance plan?  Is your disability income keeping up with your income?  Do you have any term life insurance policies expiring soon?  Do you need additional coverage or less coverage?  Let’s discuss.

Are you on track to meet your financial goals?  Do you have a plan to get you where you want to be?  If you do not you may not reach your goals.  Let’s make a plan to Maximize your financial potential.

Do you need a debt payoff plan?  Let’s work on one together.

Need help with your 401k?  I am now using GoToMeeting.com to allow me to help review your 401k online and help you rebalance.  We can access the plan together online, I can give you control to log in and then we can discuss and make changes together.  Let me know if you want to discuss!

Are your cash reserves earning less than 1%?  Consider a short-term US treasury fund, municipal bond fund or corporate bond fund to give your secondary cash reserves a yield boost.

If you have any questions or if you would like to have help with your financial plan please give me – your Fee-only Certified Financial Planning ™ Practitioner – a call.

Useful Links

Work on Your Financial Plan:  

https://www.moneyguidepro.com/redtail/Guests.aspx?gst=072A4BB9148EA94CD07038D0645B88C0FD4A0D16DFD101119F36E4C592D27390

View Your Schwab Accounts:  www.schwab.com

Check your risk tolerance:

https://advisors.stratifi.com/investor/320/qvydglrdeivuychrqumhpzgsvdipzh/target-rating/guest/

Articles

All articles are now found on my website blog: www.aamllc.com

Social Security Tips – October 2020 – 2021 COLA
https://www.aamllc.com/social-security-tips-for-october-2020-2021-cola/

Food for Thought – Are you eating up your nestegg?
https://www.aamllc.com/food-for-thought-are-you-eating-up-your-nest-egg/

Saving Money During Covid
https://www.aamllc.com/saving-money-during-covid/

Covid-19 Could Be (and should be) A Wake Up Call
https://www.aamllc.com/covid-19-could-be-and-should-be-a-wake-up-call/

Too Much Debt Puts A Lid on Net Worth for Millennials
https://www.aamllc.com/too-much-debt-puts-lid-on-net-worth-for-millennials/

Coping with College During Covid-19
https://www.aamllc.com/coping-with-college-during-covid-19/ 

Post Pandemic – Maintain Good Saving Habits
https://www.aamllc.com/post-pandemic-maintain-good-saving-habits/

2020 Mandatory Retirement Account Withdraws Suspended
https://www.aamllc.com/2020-mandatory-retirement-account-withdrawals-suspended/

Know Your Current College Aid Options
https://www.aamllc.com/know-your-current-college-aid-options/

Contact MeDo you want more information on how I can help you?  Give me a call or drop me an email to review or set up a free initial consultation.

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Get LinkedIn www.linkedin.com/in/ronaldjvansurksum
Weekly Blog Updates and My Website www.aamllc.com

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Advanced Asset Management
4555 Wilson Ave SW, Suite 2
Grandville, MI 49418

Phone: (616) 531-5220
rvansurksum@aamllc.com